‘Why International Business Is So Important’
[Written by Michael M. Fahy, Chairman of the OBA]
Recently, the PLP did what was expected and essentially labelled the OBA as pro business and the PLP as pro labour. The truth is that both parties should be both. Why? Because both these arms of society contribute much to our well-being.
I believe all Bermudians recognise the important role labour has played in past decades improving the lives of working Bermudians – in terms of income, security and working conditions. There is, on the other hand, a reluctance to acknowledge or appreciate how much international business benefits our lives.
It benefits the Bermudian employed as a trucker’s assistant moving furniture. It benefits the Bermudian in an office equipment company. It benefits the Bermudian attorney. It benefits the Bermudian waiter. It benefits the Bermudian public health worker. It benefits the Bermudian clerk at the Department of Immigration. It benefits charities all over the country. It benefits the mortgage requirements of many Bermudians. Virtually every sector of our economy relies on international business for survival. How? It is simple.
Non-Bermudian Joe Bloggs is hired as a president of an exempted company.
He hires support staff for his company. He pays for a Bermudian attorney to draft the employment contracts.
He needs a work permit. Government hires a Bermudian to process that permit. He therefore contributes to the employment for the Bermudian immigration clerk.
He needs to move his family and belongings to Bermuda so he pays a moving company to do it – essentially paying the wage of the Bermudian trucker’s assistant who picks his stuff up off the docks.
He likes to go out and eat. His bill helps pay the wage of the Bermudian waiter.
He has a child when living here. The public health worker, who is a Bermudian nurse, does a home visit.
His spouse gives her time to a local charity. Without Joe Bloggs, there is no Joe Bloggs spouse. There is no charity worker.
His company buys a photocopier. The local office equipment company survives and pays its Bermudian staff.
He rents a large apartment from a Bermudian who relies on the income to pay for his/her mortgage. Without Joe Bloggs there is less home ownership.
The payroll tax paid by guest workers is a tremendous sum in the grand scheme of things. Without international business, which makes up about 65% of the Island’s total income, our economy could not support our population. Payroll tax helps pays for Government workers’ salaries, road improvements, ferries and busses – you name it.
So the OBA is a pro-business party, but it is also a party that is committed to protecting the rights of Bermudians in the workplace. There is a fine balance that must be met to protect both Bermudians and the businesses that make it possible for them to earn a living. The problem for us, and many Bermudians, is that the PLP Government has neither protected Bermudian livelihoods nor protected business. International business companies are leaving, and consequently Bermudians in the public and private sector are losing their jobs.
So the OBA will do anything and everything it can to attract international business, for the sake of Bermudian from all walks of life. We want to grow the economic pie so that every Bermudian can earn a piece that helps them feed their families, pay their bills and even fly off the island for a vacation.
All of us can benefit from a government that strikes the right balance – keeping businesses and people working – from the Bermudian trucker’s assistant, to the Bermudian public health worker, to the Bermudian landlord, to the Bermudian attorney, to the Bermudian office equipment worker, to the Bermudian waiter, to the Bermudian immigration department clerk.
That balance, with the strong arms of business and labour in concert, is the key to long-term success for all Bermudians. It’s about sharing a vision of One Bermuda and working together to grow opportunity for one and all. It’s about putting Bermuda first.
So, when you hear negative rhetoric, when you read words that are intended to tear people down, when you sense people are trying to keep people apart, just keep moving. There’s no future that way.
We can only build a better Bermuda by building people up and bringing them together. That’s the energy we want to harness for the sake of Bermuda. That’s the direction we want to move this country.
Well Done Michael. Now please help us out, how will the OBA do this, and how will they be better than the PLP.
Oh right. In the past few years the plp ridiculed every warning about the economy. “We’re different” “You’re making mischief”. “We don’t want your advice” “We don’t care what you think”.
That was the plp reaction.
And now that we’re in a complete mess, now you want ideas? Now that you’re clueless about what to do next, you want to hear what someone else thinks? Why? We all know the plp will carry on in its usual way: lurching from one disastrous mess to another with no planning, no forethought, no ideas, other than the overriding impulse to line its own pockets.
My idea is to hire Ewart Brown and Paula Cox as consultants, and everything they suggest, do the opposite!
You can talk all you want Mr. Fahy, but the PLP will never debate you or the Alliance about anything. They know they have already lost on that front. If the PLP ever loose an election, they will be finished forever, and they too (being a legacy party) will fade away like the UBP. Just hope the island is worth anything by then.
At para #7. “So the OBA will do anything and everything it can to attract international business, for the sake of Bermudian from all walks of life. We want to grow the economic pie so that every Bermudian can earn a piece that helps them feed their families, pay their bills and even fly off the island for a vacation.”
Such comments can easily be seen as vacuous statements. Please explain how the “OBA will do anything and everything”. Please start with your strategy for immigration. How will you also ensure GENUINE opportunity for QUALIFIED Bermudians to be gainfully employed at their full potential and eliminate the glass ceilings that currently exist.
No no no… this should be called:
“Why International Business WAS So Important”
All the international business, if it hasn’t already left, is leaving Bermuda.
This is the same “its all about us” rationale for Bermuda’s socio-economic model that the UBP and what was then BIBA trotted out in the mid 1990′s.
The characterization of Bermudian’s working as domestic and support staff for multi millionaire expat Joe Bloggs expat and his non-working trophy wife is exactly why the PLP with its 1960′s Black Power rhetoric dominates the political landscape.
Frank
Frank,
I work for a an exempt company. Employs 26 people. 4 people have work permits. 22 are Bermudian, in very good jobs. The management is mostly Bermudian, including the top guy. We are in a very difficult business. If the govt makes life difficult for us to compete, it’s possible we can continue maybe, or it’s possible life gets so difficult we have to downsize.
Who gets hurt most? The 22 Bermudians, or the 4 nonBermudians?
Also, your imaginary “multi millionaire” expat with his “trophy wife”? Get real, man. Expats work hard, they’re essential to our business. They do ok, but they are not multimillionaires. That’s just a myth.
CrazyTalk
I didn’t imagine it. Read Mr Fahy’s article again, profiling Joe Bloggs. Then dig out the UBP’/BIBA literature on “its about us” – its the same stuff.
I didn’t say that expats don’t work hard or aren’t essential – i might even be an expat.
What is NOT a myth is that telling (predominately black) Bermudians that they need to play the background is in direct opposition to the PLP’s black power rhetoric. Even if that’s not how it was intended it doesn’t take much for the PLP to make it seem that way.
In a predominately black community its a loosing proposition.
Indeed to say that expats are “doing alright” while Bermudians are shooting each other at an alarming rate is a politically outrageous thing to say.
Frank
CrazyTalk
I forgot to ask…using Mr Fahy’s profile of Joe Bloggs, humor me and take a speculative view on how much Joe Bloggs would be earning.
Then look at the latest manpower survey and tell me the average black Bermudians salary.
I would wager that doing simple exercise feeds those with a black power/independence agenda.
The hypothetical Joe Bloggs (I know a few) has a wife who stays at home (she can’t work because she would need a permit). Has a child. Eats in restaurants with his family once in a while. Rents a place to live. Drives a car. Rides a bike. Big deal. He isn’t a “millionaire” with a “trophy wife”. You paint an absurd stereotypical picture that just is not real.
But you haven’t actually answered my question and refuse to accept that its not “my” Joe bloggs but Mr Fahy’s.
But that’s us..arguments for arguments sake.
Your question is unanswerable, really.
The person eats, has a child, and lives in an apartment. His company buys a photocopier. How the hell do I know what he earns? You tell me. The same description could apply to almost anyone at almost any income.
Get ACE and XL etc financial statements (freely available from their websites) and see how much people like Evan Greenberg and Brian Duperreault earned (their compensation is disclosed) and compare that to the average Bermudians income.
These two fit Mr Fahy’s Joe Bloggs profile.
Factually you’re not correct there. Brian Duppereault is Bermudian, so the details in the “Joe Bloggs” profile about work permits, moving here, etc, don’t apply to him. So I’m not sure what your point is when you bring his name into it. Are you back on the race thing again?
Anyway, there is another problem with your comparison. The Joe Bloggs example is (according to the article) hired as a president of an exempt company. Comparing the remuneration of a president of company with the average salary on the island is ridiculous. You could do that anywhere in the world, and the president of a significant company would normally earn much more than average. Your implication that black Bermudians should find that unfair is absurd.
Ha ha…got me on BP he fact that he is Bermudian makes it even worse!
even so BP made $14m in 2009. and you don’t think someone earning $50k who is told to feel lucky they even have a job might not feel a little aggrieved at the disparity?
What is ridiculous is My Fahy using the president of a company as an example. which was my point for the get go. It indicates that the OBA IS the NewBP and gives the PLP an easy rebuttal.
Mr Fahy should have described an accountant, underwriter or broker who come to Bermuda to gain experience before heading back to the US/UK of course some will stay..
Frank, A guy with decades of experience, who is running a worldwide business with 52,000 employees, is going to get paid a lot more than average. You exaggerate the actual number, of course (I can read as well), but BD makes a lot of money, no argument on that.
So: I guess to spare the potential hurt feelings of those who make 50k a year, you would prefer it if Bermuda had no international business? Or only businesses that don’t pay well? Have to admit I am struggling to see how this would benefit us, but perhaps you can clarify that.
@Crazytalk
“If the govt makes life difficult for us to compete”
Please tell me how the government has made it difficult for you to compete?
I did not say it has. Read a bit more carefully.
Who is John Galt?
I dont think mr fahy is trying to paint a socio economic mid 1990′s picture. all he seems to be saying is that business is very important to bermuda? amazing how this stuff is spun around to try and fit into a plp argument
Well Michael I guess it back to the plantation for us black people then!!!!
This is a sober reflection of the entitlement mentaliby the PLP have brainwashed people with. Do you honesty think the trucker’s assistant should be an executive at XL or ACE? Or the room cleaner at Hamilton Princess should be an investment manager at LOM?
So what else would you suggest Bermudian’s do? Run international companies each and everyone. Do your realise the hard work, the rat race that high end managerial positions require. We are a tiny Island with no ability to export. So litteraly apart from our tax structure at present we have nothig to offer the world.
It’s this ignorant fear-mongering mentality that people have continued to be brain-washed with that’s keeping this island from moving forward. It’s sad really that this bitterness cycle has been passed on from generation to generation thanks to the poor education system we have (and yes, I’ve heard children using this rhetoric at my children’s primary school). Can we not get our heads out of the 19th century and keep an open mind to anyone who just wants to move forward with a better, more inclusive future for Bermuda regardless of their skin type?
Frantalk is so right!
Nobody is willing to admit that the key reasons our international business is on the ropes is because one of the key elements to our business model “no tax on profits and capital gains” is under attack and is being eroded very quickly and the other is our reputation regarding tax evasion and money laundering scandals, involving Bermuda registered entities and facilitated by Bermudian service provider.
Wake Up Bermuda!
We need to get tourism back up and running so it actually makes this country $$$$$. Too much reliance on IB is not healthy and we need to balance the Economy with another pillar. There is allot of negativity surrounding Casino’s but without them we fail to attract hotel developers and operators who see Bermuda as a viable business model for resorts. It is estimated that nearly 1/3 of hotel income comes from Casino revenue in Barbados and it is far cheaper to build / run a hotel out there when compared with Bermuda. If Casino’s were operating in Bermuda under tight controls that helped limit their usage to Hotel properties and guests only, it could create millions in tax dollars, boost tourism, boost nightlife, create ‘real’ hotel Development (not just talk of it) and as a result provide many jobs and support existing businesses on the Island. We need to look at it seriously and think about the positives of attracting a new line of business to the Island. We are so close to the East coast and in that lies our largest competitive advantage.
People go to other Caribbean destinations in droves because it’s cheap and the workers go above and beyond to accommodate because they know there’s a line up of people desperate to have their job. The only way Bermuda tourism will get to this level is if IB pulls out resulting in a financial collapse. It’s one or the other in my opinion and I think we’re all better off in this scenario.
Jim and Justin,
I don’t think there can be any doubt that Mr Fahy’s article is highlighting how/why we need to support IB. Note “support”. Not “drive” or “fully participate in”.
This was exactly the UBP’s pitch on IB.
Its not about unrealistic career paths, but the assumption (fact) that the vast majority of decision makers will be expats (which in PLP terms means white) and in every practical sense certain jobs or classes of jobs are closed to Bermudians.
Of course this assumption (fact) is reinforced by our substandard education system
By running with this theme – along with the redrawn electoral map – the OBA is serving up political cannon fodder for the PLP.
Frank
Frank,
I agree with everything you’ve said from a political standpoint. Indeed, the PLP have misled people to believe that expats are bad and Bermudians are entitled to a good life because they are simply Bermudian. However, the reality is that every individual must work for what they want and there will be competition. Unfortunately, the PLP has brainwashed people so thoroughly that it will be difficult to get them to realize this.
Therefore, to win an election the OBA is better off feeding Bermudians the traditional PLP entitlment rhetoric instead of giving people a reality check. They should also throw in free food, houses, boats and golf memberships too. As someone has already said, “the PLP have always been good at politics but bad in policy, and the UBP has always been good at policy but bad at politics”. It appears as if the OBA might be heading down the same road as the UBP in this regard.
‘So the OBA will do anything and everything it can to attract international business…’
What about encouraging a sustainable contribution toward the economy from international business instead of doing ‘anything and everything’ to encourage growth? What about acknowledging there are also negative social and economic pressures from IB? Is no-one else concerned about the pressure a return to recent population levels will place on the cost of housing? Sure a lot of landlords are struggling now, but many Bermudians will never have the opportunity to afford a home in their own country until the gap between wages and house prices closes. Three years ago a few dozen people would have to interview for an apartment and a single parent didn’t stand a chance. There has to be a balance and it is concerning to see this is not acknowledged.
so true.
@ Bad Slave…I would rather be on a “Plantation” with food and water than in the middle of the ocean without a desalinization plant.
Now be a good slave and go back too work. …..jingus………
At 95% of our economy, this is not an argument. It is a factual necessity. These arguments are moot. Bermuda must have IB; it is essential if we are to have free education; a billion dollar health industry; nice cars; be able to take holidays; jobs; etc. etc. Now,let’s intelligently discuss how we are going to keep this business and make it work for everyone. Cut the shit with the 60s plantation rhetoric and look to the future. So the OBA supports IB. You know, I have no idea where the PLP stands -it seems to waver depending on the political landscape. I do know that Bermudians have deep concerns about the medium and long term future of the country, and these concerns are based on economics. That means people are concerned about IB. Now, can we accept that Bermudians can’t do everything on their own and implement policy that supports, welcomes, and work with the development of this sector at all levels – a policy that does not allow the rubbishing of expats; millionaires; their families; Canadians; black expats with the hearts of white men; Portuguese; etc. If Bermudians were taught to respect others -and their country- we would be on the right track. Zero tolerance is so far from own national thinking, agreed, but some sort of accountability, some check or balance. Perhaps we could start doing what is right rather than what we want.
Joe,
Your comments are spot on with one exception IMHO…IB is not a “factual necessity”; but a requirement GIVEN a desire to maintain or increase our wealth being 0 the highest GDP per capita in the world.
Perhaps a constructive dialogue would start with: “what are we willing to do or indeed give up to maintain our standard of living?”
A more specific question would be: Is remaining dependent and choosing not to pursue self determination a reasonable sacrifice in our pursuit of wealth? If so are we happy that the distribution of wealth is fair?
Frank
How is the distribution of wealth and independence linked? Just a question.
Also how do you determine if the distribution of wealth is fair or not? Would not the market be the determining factor? Or is your argument based on there should be more Black owned businesses (ie Market places and such)? Discounting that a business is a separate entity in it’s self and should continue if it is successful hence the “Family” business being past down from generation to generation (wealth disparity that you speak of)? Due to slavery and how our economy developed using the free market model how do you think this should be rectified? How should this changing of the wealth be done?
LOL
LOL
I don’t know where you have been since say 1997 (LOL)…but the main rebuttal to the Independence question (or indeed why is it ok that senior management of or economy is heavily weighted to non Bermudians) is that we will suffer economically. So that is the connection.
Hopefully I haven’t brought race into this debate because I think its a red herring. But in that vein there is a massive disparity in terms of HOW we participate in the economy between the races. Do we really understand why that is? Its is purely due to racism and the legacy of slavery?
For the disparity look at the latest man power survey which gives average salaries according to any number of parameters.
I haven’t yet had an opportunity to flesh this out fully…but instead of better sharing of the economic pie, perhaps the pie needs to get smaller. Prices of goods including labour – which is inflated to some degree by IB – need to come down.
It won’t be pretty but its just a thought..
Frank,
If the pie shrinks, gets smaller, and prices are brought down by some means, those things will be symptoms of all of us doing less well. In fact, that’s essentially what has happened over the past 3 years or so. Black, white, everybody is generally worse off now than 3 years ago, on average.
If the pie is reduced further deliberately by political change, and prices with it, we will all again do less well, on average. Perhaps there would be less perceived disparity between one person and another, but perhaps not: we can all think of socialist-type regimes where the ruling elite live (or lived) like kings in absolute luxury while the average person stands no chance of anything other than poverty.
If the pie can be maintained, expanded, developed, the hope is that it provides opportunity for everyone who wants to make an honest living. And for those people who need help, at least there would be resources to assist them.
You did bring race into it, which is a red herring in the discussion, I think. In which scenario do people do better? I know what I think.
Franktalk wants us all wearing olive green suits and all earning the same. Maybe pledging alliegance the The Party every morning as well.
If we all earn $100 a month and live in tin shacks at least no one has more than anyone else, right Frank?
not quite Rick,
I’d like to feel safe when out in public, not have to be overly careful as to the routes I use to travel, not have live under a self imposed curfew (i.e. off the streets after dark) and not lie awake at night knowing that in spite of all of the above I can’t be 100% sure that the back lash coming from the underclass that we have created and continue to perpetuate won’t touch me or my family…
And if you think being in an underclass is a “personal choice” then there is no hope…
If a person graduates from high school, gets and keeps a job after high school, and refrains from having children prior to being married, that person will do relatively well in life.
Yes, I can see the point.
It is a difficult question to answer, however it ought to be. Are we mature enough to answer it honestly? As a country we have demonstrated a unique lack of maturity in solving our problems (viz the blogs) and so maybe we need another Big Conversation: Our Future: Where do we go from here?
Honestly, I don’t think either party has a clear notion of what this answer should be.
No one ever seems to discuss the fact that any hope of more Bermudians filling higher-end jobs is dependent on those same Bermudians receiving a proper education. In fact, the poor education of Bermudians is IMHO the root cause of many of today’s problems. Without a good education, no one can advance themselves. The key to Bermuda’s future success is to invest in all levels of education, and give EVERYONE access to that education. Otherwise, we set ourselves up to be the guys working in the background and in support roles while those more educated lord over us.
Another thing lacking, which the current government (including all of its past administrations) has proved time and again that they are incapable of doing, is thinking LONG TERM. Without a vision of the future, something we can work towards and come together for a common purpose, this island is doomed to fail. Stop the bickering and feelings of entitlement, work together and realise the fact that the island has been wandering aimlessly for years now, and until it finds ONE direction, we’ll be wandering off the end of the cliff into the abyss. Then it won’t matter whether you’re white or black. Rock bottom is colour-blind.
I had quite a few friends back in the ’90′s who would call themselves Aceboys and Acegirls .They would shamelessly flaunt thier $30 and $50 thousand dollar year end bonuses . The party ended soon after . IB is indeed great for Bermuda ,but, it did create some very unrealistic attitudes about money . I remain the lowly but happy peon .